BILL NUMBER: AB 329	CHAPTERED  10/10/99

	CHAPTER   883
	FILED WITH SECRETARY OF STATE   OCTOBER 10, 1999
	APPROVED BY GOVERNOR   OCTOBER 9, 1999
	PASSED THE ASSEMBLY   AUGUST 31, 1999
	PASSED THE SENATE   AUGUST 24, 1999
	AMENDED IN SENATE   JULY 7, 1999
	AMENDED IN SENATE   JUNE 24, 1999
	AMENDED IN SENATE   JUNE 17, 1999
	AMENDED IN SENATE   JUNE 10, 1999
	AMENDED IN ASSEMBLY   APRIL 26, 1999
	AMENDED IN ASSEMBLY   MARCH 18, 1999

INTRODUCED BY   Assembly Member Scott

                        FEBRUARY 11, 1999

   An act to add Section 11580.02 to the Insurance Code, relating to
insurance.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 329, Scott.  Insurance:  compensation:  fees.
   Existing law imposes various requirements on liability insurers
and on policies issued by liability insurers.
   This bill would authorize a liability insurer to review bills
submitted for the defense of its insured, but would  prohibit a
liability insurer from compensating a reviewer based on (1) a
percentage of the amount by which a bill is reduced, (2) the number
of claims or cost of services for which the reviewer has denied
authorization or payment, or (3) an agreement that no compensation
will be due unless one or more bills are reduced for payment.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 11580.02 is added to the Insurance Code, to
read:
   11580.02.  A liability insurer may review bills submitted for the
defense of its insured, but shall not compensate a reviewer based on
any of the following:
   (a) A percentage of the amount by which a bill is reduced for
payment.
   (b) The number of claims or the cost of services for which the
reviewer has denied authorization or payment.
   (c) An agreement that no compensation will be due unless one or
more bills are reduced for payment.
